Transcripts

Economic Optimism Doesn't Add Up To New Jobs

SUSIE GHARIB: On the labor scene closer to home, many American employers are confident about the economy these days, but apparently not confident enough to add new workers. A new survey by Manpower shows the majority of U.S. businesses it recently polled have no plans to hire in the next quarter. As Diane Eastabrook reports, high energy prices, rising interest rates, and other concerns are the obstacles to expanding the labor force.

DIANE EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT: RS Owens is in the midst of making nearly a thousand Emmy awards, just as it has every spring for the past 30 years. But the Chicago manufacturer is doing the job this year with about 20 fewer employees than it had a few years ago. Productivity improvements and new competition from other firms have the nearly 70-year-old company holding the line on hiring.

SCOTT SIEGEL, PRESIDENT, R.S. OWENS: We haven`t been replacing factory people as they leave because we`ve been off-shoring some of our manufacturing and buying more product manufactured outside of the United States.

EASTABROOK: What is happening at RS Owens could be happening at many other companies across the U.S. In the latest Manpower survey, 57 percent of the 16,000 firms polled said they aren`t planning to hire in the third quarter. Thirty one percent of the companies polled say they do plan to add workers, 6 percent expect layoffs and the remaining 6 percent are uncertain. Manpower says the sectors that offer the best prospects for job growth include real estate, transportation, and the service industry. Economists think the survey reflects an economy that is still growing. But they also think it reflects an economy suffering growing pains as employers try to determine where interest rates and costs are headed. DIANE SWONK, CHIEF ECONOMIST, MESIROW FINANCIAL: We`ve got high energy prices still plaguing companies. They`re trying to do more with less to deal with those persistently high energy prices. That includes everything from investing in energy-saving technologies to maybe not hiring as aggressively as they might have been.

EASTABROOK: RS Owens says energy isn`t its only concern. The price of gold, silver, pewter, and zinc -- all used to make its awards -- have also skyrocketed and Siegel says rising healthcare insurance remains his biggest concern.

SIEGEL: The major impediment to having more employees, in my eyes, right now is the cost of healthcare. Our healthcare costs went up 20 percent this year. We had to change providers.

EASTABROOK: Siegel is optimistic RS Owens will be adding more workers over the next few years. But he is quick to point out those workers will probably be added through the acquisition of other companies. Diane Eastabrook, NIGHTLY BUSINESS REPORT Chicago.